DFVC Procedures for Multiple Top-Hat Plans

A client recently discovered that they failed to file the Department of Labor (“DOL”) top-hat filings for two separate plans.  As we prepared the remedial filing under the Delinquent Filer Voluntary Compliance (“DFVC”) Program, we received conflicting information from the DOL website and staff on the required $750 late filing fee.  If you are faced with this situation, we hope to give you a leg up. The Payment Data Collection page used to file DFVC materials electronically provides under Statement 2 that “I understand that I am only submitting, and receiving relief for, the filings for the plan and the plan years that are listed above.”  As “plan” is singular, and as we could find no way to list multiple plans, we contacted the DOL.  Our concern was each filing required a separate fee, so if we could not list multiple plans, the client would have to pay multiple fees.  This treatment was the opposite of how we had understood the fee in the past.  Previously, we understood that there was only one $750 fee no matter the number of plans covered.

We talked to two different people at the DOL, in the office that handles DFVC filings, and we were told the fee was $750 per plan.  We told them we had never interpreted the rules that way, nor had we understood the DOL to have interpreted them that way in the past.

After reexamining the regulations, we contacted the DOL to make our case one last time. We explained our dilemma and cited the language in the DFVC Regulations (60 Fed. Reg. 20876 (1995) and 67 Fed. Reg. 15060 (2002)), which expressly provides that there is one penalty amount without regard to the number of plans or number of participants covered under such plans.  This time the DOL agreed that only one fee would be required.  Our contact explained how we should make such filings.

The procedure is to put all of the plan names, separated by slashes, into the "Plan Name" box on the online DVFC filing. Then, as in the past, list all plans in need of correction on the hard copy of the top-hat filing with their effective dates and number of participants, and submit it by mail.

Perhaps the DOL does not get many questions on the DFVC Program for top-hat plans, and staff members deal more often with other DFVC filing issues.  In any case, we are glad that we persisted.